Company culture as a driver of motivation and performance: how to make it work !

Building and embedding a strong company culture is anything but easy. That is precisely why it represents such a powerful competitive advantage for organizations. When thoughtfully designed, company culture can serve as a source of motivation and performance that enables organizations to regain control over employee engagement and results. And yet, leaders are only just beginning to realize that culture cannot be left to chance. Because company culture, like any foundational initiative, is a matter of engineering… not magic.

WHY COMPANY CULTURE SHAPES MOTIVATION AND PERFORMANCE

Business leaders are becoming increasingly aware of this reality. Company culture, as a powerful driver of motivation and performance, plays a decisive role in success. Still, it is often seen as an almost “magical” force, one that only few people truly know how to address or influence. Unsurprisingly, most leaders end up relying on intuition to manage it effectively.

And yet, answering three simple questions could help them take back control and move toward a culture management approach grounded in science rather than mystery.

1. HOW DOES COMPANY CULTURE LEAD TO PERFORMANCE?

Many academics have studied what drives people to invest themselves in their work. A major breakthrough occurred in the 1980s, when professors Edward Deci and Richard Ryan identified six primary reasons for motivation in the modern workplace: play, purpose, potential, emotional pressure, economic pressure, and inertia.

Subsequent research has shown that the first three tend to increase performance, while the latter three tend to reduce it. Organizations best known for both culture and performance focus on amplifying the right drivers while limiting the harmful ones.

• Play occurs when you are motivated by the work itself. You work because you enjoy it. The reason lies in a strong inclination toward the learning instinct, in other words curiosity, experimentation, and the exploration of complex problems.
  For example, a teacher who “plays” enjoys the core activities of the profession, such as designing lesson plans, grading, or solving problems.

• Purpose is present when the direct outcome of your work aligns with your identity. You work because you can see and value the impact of what you do.
  For example, a teacher driven by purpose is motivated by educating children, helping them become independent, and watching them grow.

• Potential comes into play when the outcome of the work benefits your identity. In other words, the work increases your future possibilities.
  For example, a teacher who invests deeply in their role because they aspire to become a school principal one day.

Because these three motives are directly tied to the work itself, they can be considered direct drivers. They positively influence performance to varying degrees. Indirect drivers, by contrast, have a negative effect on performance.

• Emotional pressure arises when you work because external forces threaten your identity. Fear, peer pressure, guilt, and shame are all forms of emotional pressure. When you act to avoid disappointing yourself or others, emotional pressure is at play. This motive is entirely disconnected from the work itself.

• Economic pressure occurs when an external force compels you to work. You work to obtain a reward or avoid a penalty. This motive is not only separate from the work itself, but also detached from your identity.

• Inertia appears when the motive is so far removed from both the work and your identity that you cannot explain why you are working at all. Meaning is lost. When asked why you still do the same job, you have no clear answer.

2. WHAT IS THE VALUE OF COMPANY CULTURE?

It is entirely possible to build a business case for company culture once it is viewed as a measurable source of motivation and performance. While it may be difficult to assess in real time whether someone is creative, proactive, or resilient, it is far easier to measure motivation and then determine its impact on organizational performance. This requires a quantitative approach, refined by qualitative insights (cf. HBR).

Organizations that have emphasized play, purpose, and potential, while reducing emotional pressure, economic pressure, and inertia, have achieved stronger results and higher customer satisfaction.

And the impact goes further. Overall performance is higher in organizations that have reshaped their culture around these drivers, whether in terms of employee motivation, customer portfolio management, or other outcomes.

3. WHICH PROCESSES SHAPE COMPANY CULTURE?

Most managers do not have a clear definition of what company culture actually is, let alone how it relates to performance. Here is one definition: “Culture is the set of organizational processes that influence employee motivation.”

There is no miracle solution. Many processes affect motivation at work, from job design to performance evaluation.

In a high-performing company culture, the organization focuses on processes that maximize motivation.

Many assume leadership is the primary source of motivation, but other processes can have an even greater impact. The horizontal axis represents the motivation scale, ranging from -100 to +100. The gray bars show the range within which each process influences an employee’s total motivation.

For example, the way a role is designed can shift total motivation by as much as 87 points. Poorly designed roles lead to very low motivation scores, close to -40, while well-designed roles can reach nearly +50. This is a significant gap, especially considering that in many industries, the most admired cultures outperform their peers by only about 15 motivation points.

Role design is therefore the most sensitive motivational factor. Some companies make deliberate efforts to create highly motivating roles, for instance by giving employees time and resources to develop new ideas.

The second most sensitive factor is corporate identity, which includes vision, ambition, mission, values, and commitments. These elements give meaning to action. Some organizations, for example, invite customers to executive meetings so decision-makers remain closely connected to reality and can directly observe the impact of their choices on end users.

The third factor is career progression. Many companies have concluded that their performance evaluation systems, which drive promotion decisions, tend to undermine performance. Systems that rank employees or pit them against one another increase emotional and economic pressure, reducing motivation and, in turn, performance.

Culture functions as an ecosystem. Its elements interact and reinforce one another. Sales commissions are a good illustration. In general, simply having a commission can reduce an individual’s motivation to sell. However, if that same individual believes their work genuinely helps customers, the commission can dramatically increase motivation.

This only makes sense when seeking “total” motivation. If you do not believe in what you do, the commission becomes your primary reason for working, and that is a weak form of motivation. If you believe in what you do, the commission becomes a powerful amplifier. It can even trigger a continuous improvement dynamic by strengthening the “play” dimension at the same time.

WHAT LEADERS CAN DO…

Without completely redefining the company’s identity or overhauling all organizational processes, leaders can start by acting on a few very concrete areas to improve employees’ total motivation. This includes working on genuine team engagement and their ability to take ownership of change. In doing so, they also shape the culture of their company at every level, from leadership to teams, departments, and beyond.

• Explain the “why” behind the company’s direction and team initiatives, to provide clarity and meaning.

• Review how team roles are designed and assigned, and how they complement one another, so that everyone can find meaning and value in their role.

• Organize and involve employees in regular reflection sessions on cross-functional, high-value topics..

• Give employees who want it enough room to “play.”

• Create dedicated time and spaces where employees are free to propose ideas, experiment, and test them, beyond formal reflection meetings.

• Make sure everyone can directly see the impact of their work and the value it creates.

• Set meaningful goals that align with employees’ long-term aspirations and development potential.

Interested in discussing your challenges related to company culture, motivation, or collective performance? Contact us!

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Freely inspired by a HBR article.
Illustration credit: Dave WHEELER for HBR